China assailed Taiwan's President, Lee Teng-hui, again today, saying his retraction of the island's long-standing "one China" policy constituted a move toward independence that could bring "monumental disaster" to Taiwan.

The criticism, carried in a New China News Agency commentary that ran on the front pages of newspapers here, did not spell out what steps China might take. But the Foreign Ministry repeated China's long-standing threat to use force if Taiwan formally declares independence.

In a bid to reduce tension, a senior official at Taiwan's Mainland Affairs Council urged China to move ahead with talks scheduled for the fall. But Taiwanese officials stuck to their new policy, saying they hope to convince Beijing that their actions are meant to put relations across the Taiwan Strait on a sounder foundation by describing Taiwan in more accurate terms. On Monday, China hinted that the talks might not happen.

Several factors appear to have contributed to the decision by Lee to reverse a policy that has been the basis for Taiwan's relationship with China since 1991. Just nine months before Taiwan's voters elect a new leader, Lee is seeking to seal his legacy as Taiwan's first democratically elected president by appearing to stand up for the island's 21 million people and set Taiwan's foreign policy on a tougher course, according to political analysts in Taiwan.

"Before he steps down, he wants to make sure that we go this way, that Taiwan and China are two different states," said Antonio Chiang, publisher of the Taipei Times. "He wants to use his charisma to cover his successors, so nobody can turn back the clock or change the track."

Despite government denials, political analysts say Lee is also trying to shake up his domestic opponents. Lee wants to put pressure on James Soong, a former ally in Lee's ruling Nationalist Party, who may challenge Lee's chosen successor, Vice President Lien Chan, in the presidential campaign.

In a recent interview, Soong advocated a significant improvement in ties with Beijing. He said he would allow direct air and sea links, and would consider changing some of Lee's most provocative policies, such as Taiwan's effort to gain a seat in the United Nations.

The timing of Lee's comments was intended to force Soong to take sides on the "mainland issue," analysts said. So far, Lien has expressed support for Lee's rejection of the "one China" policy. Soong has withheld comment on the decision, saying only that procedures used to make the policy shift were haphazard.

Lee hopes to co-opt some support from the opposition Democratic Progressive Party, which has advocated outright independence from Beijing, analysts said.

Lee said on Saturday that ties with China should be considered "state-to-state relations," a direct challenge to Beijing's view that Taiwan is a province of China. Su Chi, Taiwan's top official on mainland affairs, amplified those comments Monday when he officially rejected the "one China" policy.

In 1991, Taiwan acknowledged that China's Communist government had jurisdiction over the mainland but said that the Republic of China, as Taiwan is known, had jurisdiction over Taiwan. It held that both were "political entities" that were part of "one China" that may eventually unite.

Taiwan's policy shift took many people by surprise, but analysts pointed out that Taiwanese officials have been saying for months, if not years, that they effectively have a "two China" policy. In meetings last year before high-level talks in Beijing, officials decided to insist that Taiwan be treated as an equal in any negotiations on reunification. Thus, Lee's statements are an attempt to formalize this equal status.

While Lee's moves have angered Beijing, many in Taiwan approve, saying the president is simply stating what they already know--that capitalist Taiwan has ruled itself for decades beyond the control of China's Communist leadership.

"Everybody knows, of course, Taiwan is a country. It's like the emperor's clothes. Now, they said the emperor has no clothes," said Chiang, the newspaper publisher. "It's kind of silly to continue to say Taiwan is a 'political entity.' What does that mean? It's very confusing. Even people in Taiwan don't understand what that means."

Ever since he became president, Lee has had a rough relationship with Beijing, which has singled him out as the source of the two sides' problems. China lobbed missiles over Taiwan to scare voters into opposing Lee in the island's first democratic presidential elections in 1996. That gambit did not work, and Lee won in a landslide.

One unanswered question is how the Taiwanese government's new stance will affect U.S. relations with Taiwan and China. When he was in China last year, President Clinton announced publicly that the U.S. had a "one China" policy. The Clinton administration repeated that policy Monday and today called for dialogue and restraint by Beijing and Taipei to resolve their differences.

CAPTION: The Taiwanese flag flies above the presidential building. Taiwan's departure from the "one China" formula has angered Beijing.